Post-Sept. 11 Fraud Alleged at Lab

MANHATTAN (CN) – Young Laboratories and Mark Young overcharged insurance companies by more than $5 million for post-Sept. 11 lab tests on dust near the World Trade Centers, the Federal Insurance Co. claims. Federal claims Young charged $795 for tests that it did not do itself, as it represented, but got another lab to do for $50.

After Young presented bills for $11.4 million to Federal and three other insurers, an outside auditor determined that he had “overcharged insurers by at least $4,984,071,” according to the complaint in New York County Court. It adds: “Federal has now discovered that YLI [Young Laboratories Inc.] overcharged by a great deal more than that, and that each of its bills, as well as other information that YLI and Young submitted to the auditors, was fraudulent.” Young was supposed to determine whether the Deutsche Bank Building, across the street from the World Trade Centers, “was too contaminated to repair.” The auditors allegedly found that Young charged $795 for PCB tests that another lab did for it for $50. “YLI then marked up those prices to unconscionable levels, while concealing the highly material fact that YLI itself was doing virtually nothing,” the complaint states. Federal demands $2.4 million. It is represented by Howard Veisz with Kornstein Veisz & Wexler. (The link to this lawsuit ends at page 5. Courthouse News will renew the link to the full complaint when it becomes available.)